Nov 20, 2024

When Leaders Break Glass

Break Glass by Nancy McClure aperte 948080386 EDIT

We've seen it countless times on fire alarms and panic buttons: Break glass in case of emergency. (The example above is from a San Francisco BART station.) It's a fitting figure of speech for a theme in my practice: When a client feels that their company's established processes are too slow or that employees are addressing a situation with insufficient urgency, they "break glass" and intervene to bypass those processes, generate the requisite urgency, and ensure that the issue is resolved now.

The leader who never breaks glass runs the risk of missing out on narrow windows of opportunity and being overtaken by fast-moving threats. Sensing when to break glass and learning how to do so with the right amount of force are essential leadership skills. But the leader who breaks glass incessantly at the first sign of delay causes other problems.

Such knee-jerk reactivity can affect the company's culture and infrastructure. As I've noted before, "[Leaders] generally have a bias for action, and when they’re faced with a system that seems to be slowing things down, they simply ignore it. This can be a great strength--but it can also be a crucial weakness, particularly when a leader’s reflexive disregard for systems prevents their healthy evolution in the organization at large." [1]

It can also affect employees' sense of responsibility and motivation: "When a leader repeatedly continues to intervene...as an organization grows...people are taught that this is the leader’s job, not theirs, and they fail to develop their own crisis-management and problem-solving abilities... Ultimately even the most intrepid employees can feel demotivated when the leader is always there to 'rescue' them." [2]

So if you're a leader facing this dilemma, what can you do? How do you know when to break glass and when to let a scenario play out? There's no single solution, but there are some practices that can help you find the right balance.

Know Your Tendencies

Most leaders I've worked with tend toward one end of the spectrum or the other. Founders and other early-stage leaders often break glass without a moment's hesitation. Many new ventures are essentially ongoing exercises in glass-breaking, and that attracts a certain personality type.

There are also many leaders who resist breaking glass or find it very difficult. Their training, formative experiences and past successes have taught them to build and rely upon orderly systems. This approach lends itself well to any number of enterprises--often large-scale or highly regulated--which also attract a certain personality type.

The challenge is that companies are dynamic entities, and leaders must be able to adapt their style to suit changing circumstances. As I've written before, "the fluidity and ambiguity that foster creative problem-solving in an early stage startup will feel like chaotic dysfunction at a later point in the company’s development." [3] And the smooth-running corporate machine will run itself right into a ditch if leadership is unable to interrupt established procedures and change course when necessary.

Knowing your tendencies is insufficient on its own, but in the absence of that self-awareness you'll likely stay in your comfort zone, do what's familiar,  and miss opportunities to adapt.

Regulate Your Emotions

Despite the popular conception of emotion as an impediment to rational thought, decades of neuroscience research has made it clear that it's a vital input to the reasoning process. [4] Even so, as the eminent neuroscientist Antonio Damasio has written, and as we all know from personal experience, "uncontrolled or misdirected emotion can be a major source of irrational behavior [and] seemingly normal reason can be disturbed by subtle biases rooted in emotion." [5]

The most relevant emotion in this context is anxiety. It's typically some form of anxiety that either drives a leader to break glass too often or prevents them from doing so when it would be useful. I'm not suggesting that you should discount or ignore your anxiety. Emotion's primary function is to alert us to potential opportunities and threats, and if we lacked the capacity for anxiety we would be in grave danger. [6]

But emotions are data, and like all data they're comprised of both signal and noise. Emotion regulation isn't suppression--that's just pretending that you're not feeling what you're feeling. In contrast, regulation involves assessing what you're feeling and putting it in perspective in order to discern the meaningful signal in the midst of all the distracting noise. In this context, this requires you to sense, comprehend, articulate and express your anxiety in ways that enable you to make a deliberate decision about whether--and how--to break glass. [7]

Learn From Every Situation

Becoming more effective at breaking glass--and knowing when not to--isn't just a matter of advance preparation. It also entails looking back at each situation in order to learn from it. You observed a potentially troubling delay, and you either intervened and disrupted established processes, or you refrained from taking action and let things play out. What happened?

You have to assess not only the benefits of your choice, but also the costs, and here it's important to take others' perspective into account. A theme in my practice is the leader who breaks glass repeatedly and achieves the desired result in a given situation, but over time their employees become demotivated or disaffected. I'm not suggesting that you should feel obligated to tread lightly and avoid giving offense. That will cause you to hesitate at moments when you should act decisively. But there are inevitably costs to breaking glass, and they're not always obvious.

Key factors in this process are a degree of rigor in your analysis, feedback from other stakeholders, and an ongoing effort to hone your intuition. Rigor isn't rigidity, and it may be sufficient to simply ensure that you have regular time for reflection in your calendar. [8] To provide a little more structure, consider keeping a decision journal to track your results. [9]

Soliciting feedback from stakeholders doesn't mean that they get to determine whether your choice was the right one. But in the absence of input from others, you're left with your own perceptions of success or failure, and we reliably deceive ourselves under certain circumstances. [10]

Any given decision to break glass or not will be an intuitive one, made on the basis of imperfect information and dependent on subtle cues, both internal and environmental. If the choice is obvious, it will usually be made by someone more junior than you who's closer to the problem. Intuition isn't some mystical quality--it's merely pattern recognition occurring on the margins of consciousness, as noted by economist and psychologist Herbert Simon:

The situation has provided a cue; this cue has given the expert access to information stored in memory, and the information provides the answer. Intuition is nothing more and nothing less than recognition. [11]

Your task is to ensure that the accuracy of your intuitive judgments improve over time, resulting in fewer false positives--when you broke glass and the costs outweighed the benefits--as well as fewer false negatives--when you failed to break glass but should have.

 

Footnotes

[1] How to Scale: Do Less, Lead More

[2] Ibid.

[3] Ibid.

[4] Antonio Damasio on Emotion and Reason

[5] Descartes' Error: Emotion, Reason and the Human Brain, page 52 (Antonio Damasio, 1994)

[6] "It is clear that emotion should not be very susceptible to willful control. If we could turn off all our emotions, feel no pain, never laugh, not be gripped by fear or despair, stop being excited, and so on, we could easily end up dead... The priority of emotions over will is important for our survival because it allows our plans to be interrupted by the immediate pressures of reality." (White Bears and Other Unwanted Thoughts: Suppression, Obsession, and the Psychology of Mental Control, page 123, Daniel Wegner, 2nd edition, 1994)

[7] The Tyranny of Feelings

[8] How to Think (More on Open Space and Deep Work)

[9] Shane Parrish of Farnam Street offers a useful set of decision-making resources:

[10] When Heuristics Go Bad (On Cognitive Biases)

[11] What is an "Explanation" of Behavior? (Herbert Simon, Psychological Science, 1992)

 

Photo by Nancy McClure.

Nov 08, 2024

Everyone's the Hero in the Movie of Their Life

Joker and Batman by Brecht Bug 14365592824 EDIT

Much of my work as a coach involves helping clients deal with "people problems." The CEO with an overbearing investor who's full of unhelpful advice. The investor with an egotistical CEO who never listens. The CEO with a defensive executive who calls any oversight "micromanagement." The executive with a distrustful CEO who can't give up control.

In any situation like this it's important to bear in mind that everyone's the hero in the movie of their life. This is true for my clients, and it's true for the people who are causing their problems. It's true for me, and I'm willing to bet that it's true for you. It's true for almost every single person we encounter.

When we're frustrated with someone and unhappy with their behavior, or when we feel thwarted by someone and view them as an obstacle, it's remarkably easy to characterize them as a villain. We imagine that they're intentionally working at cross-purposes to us, and that their primary aim is to prevent us from achieving ours. They're not trying to build anything--they just want to tear us down. There may be some truth to such perceptions, but they rarely encompass the full truth.

Sociopaths exist, but the lifetime prevalence of antisocial personality disorder is estimated at 1 to 4 percent, and most of those people are in prison. [1] It's extraordinarily unlikely that we'll ever interact with an actual villain in day-to-day business life. I've been a coach since 2006, and I've conducted over 8,500 coaching sessions [2], and in all that time only a single client had an antagonist whose behavior was sufficiently irrational and destructive to raise the possibility of sociopathy.

It's true that there are countless zero-sum scenarios in life where there will be few winners and many losers, and the resulting pressure causes people to act selfishly and aggressively. But when we find ourselves in such a contest, it's useful to remember that our rivals and and competitors aren't villains, at least not in their own minds. From their perspective they're the heroes, fighting the good fight, and we may be their villainous adversaries.

So what's happening here, why does it matter, and what can we do about it? Humans are reliably subject to an illusion described by theologian Eric Springsted, drawing upon the work of philosopher Simone Weil: "The illusion is that it appears to us as if we were at the center of the world. We thus appear as terrifically important, and what else is of value can be ranked by its proximity to us." [3]

And as I've written before, "We can readily grasp why evolution has selected for the center of the world illusion--viewing ourselves from this perspective, we typically put our subjective needs and desires above those of others, making our own biological success more likely." [4] It's a short step from there to villainizing others while valorizing ourselves, and thus we are all the heroes in the movie of our life.

This mental model confers some benefits in a competitive environment, but it also carries a number of costs. When we view others' intentions as malevolent and their behavior as hostile, we protect ourselves against potential villains, but we also make it less likely that a mutually beneficial outcome will be achieved. We turn every contest into a zero-sum scenario, often needlessly. We forego the possibility of collegial relationships, even with rivals. And we keep ourselves in a perpetual state of hyper-vigilance and distrust, undermining our own quality of life.

To be clear, I'm not suggesting that we naively assume good intentions or leave ourselves vulnerable to bad actors. My former Stanford colleague Jeff Pfeffer describes a student of his who did just that and came to regret it:

"Why did you do that?" I inquire. "Because," she responds, "I have been taught to build relationships of authenticity and trust at work." When I ask how her efforts went, she comments that of course they didn’t work at all, because her peer was not interested in "repairing a relationship" or behaving with trust and authenticity; he was interested in taking over her team for his own advantage--a not uncommon situation. [5]

But there's a world of difference between allowing ourselves to be taken advantage of and viewing all competitors and rivals as villains. We can protect our interests and work toward our goals in a competitive environment while viewing other parties realistically and dispassionately. Some of them will turn out to be untrustworthy, overly aggressive, even predatory, and we'll need to respond appropriately. But almost all of them will believe that they're the hero, and it will serve us well to bear this in mind.

We craft stories to explain others' behavior, and there's always some missing data left out of our narratives. Further, we take action on the basis of theories and beliefs which rest upon our interpretations of a selective data set, and at each stage of this "ladder of inference" errors may creep into our thinking. Slowing down to consider what data we might be missing or misinterpreting allows us to take a broader view of the situation and act with deliberation, not reflexively. None of this precludes the possibility that we may find ourselves in a hostile conflict. As I've written before,

Sometimes fights have a way of finding us, and sometimes angry people show up uninvited and refuse to leave, and sometimes the circumstances simply dictate a zero-sum struggle. And if we're unable to de-escalate the conflict, unable to find a win-win solution, and unable to turn adversaries into allies, then a successful outcome may depend on our ability to step into the conflict and make effective use of our anger. [6]

 

Footnotes

[1] Despite the rarity of antisocial personality disorder among the general population, it's estimated that 60 percent of male prisoners have this condition. For more on this topic, see the following:

[2] I hit 8.500 coaching sessions on October 11 of this year, and I wrote this in May: 8,000 Coaching Sessions

[3] "Will and Order: The Moral Self in Augustine's De Libero Arbitrio," page 92 (Eric Springsted, Augustinian Studies, Volume 29, Issue 2, 1998). This essay is also available as a chapter in Springsted's The Act of Faith: Christian Faith and the Moral Self (2015).

[4] We're Not the Center of the World (But We Think We Are)

[5] Leadership BS: Fixing Workplaces and Careers One Truth at a Time, pages 42-43 (Jeff Pfeffer, 2015)

[6] The Value of a Good Fight

For Further Reading

The Importance of Missing Data

Racing Up the Ladder of Inference

The Importance of Slowing Down

 

Photo by Brecht Bug.

Oct 07, 2024

Guidelines for Better Virtual Events

Virtual Events by David Fulmer daveynin 49818982567 EDIT

We've optimized our space and equipment for virtual work.

We're on time, ready to go, in the right frame of mind. This may entail leaving a prior event early to take a break and avoid going back-to-back.

We keep our cameras on and ensure that we're well-lit. Facial expressions convey meaningful data that's important to share.

We keep our microphone on and don't mute ourselves. Laughter, murmurs, sighs, gasps and other sounds are also meaningful data worth sharing.

We wear headphones or ensure that we're in a private space where the conversation won't be overheard by others.

We turn off all other applications and notifications to ensure that we're not interrupted and our attention remains focused on the conversation.

We don't multi-task. Our phones are out of sight for the duration of the conversation.

We don't use chat or text to hold sidebar conversations with other participants. With the exception of breakout rooms, all communication is equally available to all participants.

We strive to find the balance between leaving space for others to complete a thought, and interrupting to express ourselves in the moment.

 

Thanks to Lisa Stefanac for her insights derived from teaching Interpersonal Dynamics virtually at the University of Chicago Booth School of Business.

Photo by David Fulmer.

Sep 02, 2024

The Antidote to "Manager Mode" is Actual Management

Steering Wheels

This is not the solution.

Management as a concept seems to have fallen into disrepute. In a recent essay Paul Graham described "manager mode" as the unpalatable alternative to "founder mode." But what is Graham really criticizing? He recounts a talk given by Airbnb CEO Brian Chesky:

The theme of Brian's talk was that the conventional wisdom about how to run larger companies is mistaken. As Airbnb grew, well-meaning people advised him that he had to run the company in a certain way for it to scale. Their advice could be optimistically summarized as "hire good people and give them room to do their jobs." He followed this advice and the results were disastrous...

The way managers are taught to run companies seems to be like modular design in the sense that you treat subtrees of the org chart as black boxes. You tell your direct reports what to do, and it's up to them to figure out how. But you don't get involved in the details of what they do. That would be micromanaging them, which is bad.

Hire good people and give them room to do their jobs. Sounds great when it's described that way, doesn't it? Except in practice, judging from the report of founder after founder, what this often turns out to mean is: hire professional fakers and let them drive the company into the ground. [1]

So Graham isn't criticizing actual management. He's criticizing the absence of management, which is an issue I've observed in my practice for years and wrote about in 2022:

It's possible for a less-experienced CEO to get in the way of their senior leaders--but more typically I see the opposite problem. The CEO gives their executives a great deal of space, only to find several months or quarters later that they backed off too far, and some important objectives were neglected and fell into the gap. [2]

Why does this happen? Why do otherwise capable CEOs fail to provide sufficient oversight to senior leaders? And why is Graham's critique of "manager mode" resonating with so many people? In large part because the historic critique of management practices--a decades-old phenomenon, not a recent one--has been so badly misunderstood and so poorly implemented that many leaders are now so fearful of being called a "micromanager" that they fail to provide sufficient management at all.

The concept of "micromanagement" is associated with the work of MIT professor Douglas McGregor, a mid-20th century pioneer in the application of behavioral science to the challenges of organizational life. [3] McGregor offered a compelling critique of the conventional approach to management, which he dubbed "Theory X." He noted that Theory X manifests in both a "hard" version that extracts employee compliance through coercion and threats, and a "soft" version that renders employees pliable by catering to their desires for comfort and security.

While we associate "hard Theory X" with the early industrial era, and it remains common in certain sectors and parts of the world, today we encounter "soft Theory X" almost everywhere in the information economy. But both hard and soft Theory X are rooted in a shared view of human nature: that people are "indolent...lack ambition, dislike responsibility [and] prefer to be led" and therefore must be "persuaded, rewarded, punished [and] controlled" in order to give best effort in pursuit of organizational goals. [4]

McGregor's alternative, Theory Y, takes as its starting point an entirely different set of assumptions about people and their capabilities:

People are not by nature passive or resistant to organizational needs. They have become so as a result of experience in organizations.

The motivation, the potential for development, the capacity for assuming responsibility, the readiness to direct behavior toward organizational goals are all present in people. Management does not put them there. It is a responsibility of management to make it possible for people to recognize and develop these human characteristics for themselves.

The essential task of management is to arrange organizational conditions and methods of operation so that people can achieve their own goals best by directing their own efforts toward organizational objectives.

This is a process primarily of creating opportunities, releasing potential, removing obstacles, encouraging growth, providing guidance. It is what Peter Drucker has called "management by objectives" in contrast to "management by control."

And I hasten to add that it does not involve the abdication of management, the absence of leadership, the lowering of standards, or the other characteristics usually associated with the "soft" approach under Theory X. [5, my emphasis]

It should be obvious that putting these Theory Y principles into practice isn't easy. Finding ways to confront and overcome this difficulty is one of the central themes in my work with clients and in my writing on this site. But compounding the problem is that McGregor's complex and nuanced ideas have been dumbed down to mean "Hire good people and give them room to do their jobs," which often results in "the abdication of management [and] the absence of leadership"--precisely the outcomes that McGregor sought to avoid.

There's a noteworthy and relevant parallel here with the work of Amy Edmondson, whose research has highlighted the importance of psychological safety in organizational life. Sadly, this concept has been misinterpreted to mean, "No one's feelings can get hurt," when it really means "No one should be punished for speaking up and sharing bad news." What has resulted are organizational cultures in which leaders are fearful of being direct and walk on eggshells to avoid giving offense, which are actually psychologically unsafe environments. [6]

So what can we do? First, let's rehabilitate the concept of management. While excessive direction and control on the part of leadership is unlikely to yield the best results from highly-skilled knowledge workers, those workers still need to be managed. They need leaders who are actively involved in the process of determining 1) who will do what by when, 2) to a certain standard of quality, 3) with regular check-ins to assess progress, 4) and the ability to intervene and change course when necessary. That's not "micromanagement"--that's just management.

And yet let's not over-correct in the process. Graham doesn't offer much detail in his definition of "founder mode," other than endorsing engagement with a wide range of employees beyond the leader's direct reports. But he does offer a warning, in his final footnote:

I also have another less optimistic prediction: as soon as the concept of founder mode becomes established, people will start misusing it. Founders who are unable to delegate even things they should will use founder mode as the excuse. [7]

At certain stages in a company's life, the leader must be intensely involved in the most minute details of every aspect of its operations. Some issues will remain under the leader's close scrutiny indefinitely, while others will come and go depending on the context, and the cultivation of the ability to know the difference is an essential leadership skill.

But just as McGregor and Edmondson's ideas have been misunderstood and misconstrued, I fear that Graham's concept of "founder mode" will be misinterpreted as both an excuse and an obligation for leaders to operate this way well beyond the point of diminishing returns, contributing not to excellence, but to under-performance and personal overwhelm. I want to free leaders from the fear of being called a "micromanager" when they're simply providing the necessary elements of management. But I also want leadership to be a sustainable calling, not a ticket to burnout. [8]

 

This is a companion piece to the following:

Footnotes

[1] Founder Mode (Paul Graham, 2024)

[2] Mind the Gap (On Leading Senior Executives)

[3] In The Micromanagement Disease: Symptoms, Diagnosis, and Cure (Public Personnel Management, 2010), Richard White makes a connection between McGregor's work on Theory X and the subsequent emergence of the term "micromanagement." White cites the Oxford English Dictionary's attribution of the first usage of "micromanagement" to a 1975 article in The Economist, but I haven't been able to verify this.

[4] "The Human Side of Enterprise," page 6 (Douglas McGregor, Leadership and Motivation, 1966). This essay is McGregor's best-known and most influential work--it originated as a speech on the Fifth Anniversary of the School of Industrial Management at MIT (later known as the Sloan School) in 1957, and was published in the American Management Association's Management Review in November of that year. It subsequently formed the basis of his 1960 book The Human Side of Enterprise. My citations here are from a posthumous collection of McGregor's work issued by MIT two years after his death to commemorate his contributions.

[5] Ibid, pages 15-16.

[6] Safety Is a Resource, Not a Destination

[7] Graham, 2024.

[8] For more on leadership and sustained excellence:

 

Photo via TomEatonSA.

Aug 04, 2024

Why Your Bonus Plan Isn't Working

Hundreds by pictures-of-money 17121925920 EDIT

A major theme in my practice is executive compensation. Like all other professionals, my clients are seeking to obtain a fair return in exchange for their services, and they're also leaders who must offer competitive compensation to attract and retain top talent. In some conversations, we'll focus on a client's own financial requirements, and in others we'll address the needs of one or more employees, or the company's overall approach to compensation

I don't provide comparable datasets or detailed guidelines for compensation plans, although I can refer my clients to people who do. [1] Instead, when working with clients on their individual compensation I'm generally helping them think about their overarching goals as well as their immediate negotiation strategy. [2] And when working with clients on employee compensation, my role is to help them consider the organizational implications of any particular choices they might make.

In the latter case, we often wrestle with the issue of bonuses. Economic sociologist Viviana Zelizer describes the various forms bonuses can take:

Advance inducements to make some major commitments (e.g. enlistment in the army), after-the-fact lump-sum rewards (e.g. veteran's bonuses, retirement bonuses), discretionary rewards by employers (e.g. Christmas bonuses), payments tied to extraordinary individual achievements (e.g. overfulfilling sales quotas, landing a big account, inventions that become company property), payments tied to collective performance (e.g. shares of company profits, group productivity rewards), and more. [3]

Typically my clients hope to use a bonus to motivate and reward behavior that will lead to "extraordinary individual achievement" or yield improved "collective performance," although for a bonus to achieve these goals a set of conditions must be met. And a problem I often see in my practice is a bonus that's offered in the absence of one or more of these conditions, which renders it far less effective as a motivator and yields frustration on the part of employees, management, or both. Why does this happen, and if you're a leader in this situation, what can you do about it?

A Lack of Clarity or Control

The desired behavior must be sufficiently distinct from ordinary activity, and employees must have a degree of control over the intended outcome. The desired behavior need not be novel or innovative--it may simply entail "do more of what's already working." It's also not necessarily the case that management must provide explicit guidelines or instructions--that's rarely feasible with highly-skilled knowledge workers. But employees must grasp that something different is being asked of them, even if it's up to them to determine how to proceed.

Should employees accept that challenge, they must also feel a sense of agency in the process. There has to be a connection between their expenditure of effort and the achievement of the goal. This doesn't mean that employees need to have total control over the outcome or that exogenous factors can't ever get in the way. But the more control they enjoy, the more effective the bonus as a source of motivation. And below a certain level of control, any bonus plan will likely be viewed as unfair and demotivating.

The Wrong Risk Profile

Employees must be comfortable with the concept of variable compensation, and optimally they prefer this to a fixed salary. Everyone's comfort level with risk varies, and this risk profile can play a significant role in our career choices. People with a relatively high tolerance for risk gravitate toward fields that offer variable payouts, largely because they're attracted by the potential upside, but in some cases because they find the uncertainty itself stimulating. They're gamblers, in a sense, and they like to bet on themselves.

This risk profile is common among the entrepreneurs and investors who comprise the majority of my clients, but it can be found in most market-facing fields, particularly sales. (And most of my clients must sell in one way or another, from closing deals to raising funds.) But many people are uncomfortable with risk, and their caution may be heightened when it comes to financial matters. They're less interested in upside potential and more intent on downside protection.

A bonus is of interest to this latter group to the extent that it's merely additive on top of already sufficient compensation--so it may not really serve leadership's goals at all. This isn't to say that bonuses never work outside of sales or similar roles. But the overall organizational culture must foster an appetite for risk, even in conventionally risk-averse functions.

Hedonic Adaptation and Loss Aversion

The bonus must be viewed as a quid pro quo for the desired behavior, not an expected function of employment. But a challenge is that we readily adapt to improved conditions and soon come to take them for granted, a process known as "hedonic adaptation." [4] Even if the above conditions are satisfied, when a bonus is paid out repeatedly it may well come to be expected by employees.

It can help to maintain a clear delineation between base and variable compensation, although even then it's likely that at least some employees will come to view the bonus as a given. When that occurs, the absence of a bonus in the future will cause even greater unhappiness, the result of "loss aversion," our propensity to weight perceived losses more heavily than equal gains. [5]

There isn't really a "solution" to these states, which are deeply rooted in human psychology. But it's important to be aware that they generate continuous upward pressure on ambitious employees' financial expectations, and leaders who fail to prepare for this eventuality are engaged in magical thinking. [6]

On Currencies

Even as I work with clients to help them optimize their compensation plans, I believe it's essential to bear in mind the work of the great 20th century psychologist Frederick Herzberg, who provided a sharp critique of conventional approaches to motivating employees, which he referred to as "kicks in the ass" or KITA. These kicks aren't only negative, in the form of criticism or threats--they can also be positive, in the form of desirable rewards:

Let us consider motivation. If I say to you, "Do this for me or the company, and in return I will give you a reward, an incentive, more status, a promotion, all the quid pro quos that exist in the industrial organization," am I motivating you? The overwhelming opinion I receive from management people is, "Yes, this is motivation." I have a year-old schnauzer. When it was a small puppy and I wanted it to move, I kicked it in the rear and it moved. Now that I have finished its obedience training, I hold up a dog biscuit when I want the schnauzer to move. In this instance, who is motivated--I or the dog? The dog wants the biscuit, but it is I who want it to move. Again, I am the one who is motivated, and the dog is the one who moves. In this instance all I did was apply KITA frontally; I exerted a pull instead of a push. When industry wishes to use such positive KITAs, it has available an incredible number and variety of dog biscuits (jelly beans for humans) to wave in front of employees to get them to jump. [7]

As I've written before,

Herzberg is exaggerating for comic effect here--I don't think he ever kicked his dog. But his larger point holds: rewards like dog biscuits and jelly beans may result in movement, but that's not the same thing as motivation. This doesn't mean rewards are irrelevant as incentives, but a key in deploying them effectively is understanding that there are two different types of motivation, intrinsic (deriving from the work itself) and extrinsic (deriving from by-products of the work or aspects of the environment in which work occurs). [8]

Bonuses and other forms of compensation are extrinsic motivators, which Herzberg called "hygiene factors." His research indicates that inadequate compensation causes tremendous job dissatisfaction, but above a certain amount (which varies for everyone), additional compensation doesn't yield greater satisfaction. I'm not suggesting that bonuses never work--that's obviously not the case. But should you find that your bonus plan is failing to deliver the desired results even in the presence of the conditions described above, it may be worth considering what other "currencies" your employees value that you may be failing to provide. [9]

 

Footnotes

[1] For more detailed guidance, I recommend these experts on executive compensation:

[2] Culture, Compensation and Negotiation

[3] A Humbler Bonus (Viviana Zelizer, The Huffington Post, 2009)

[4] For more on hedonic adaptation:

[5] For more on loss aversion:

[6] The Traps We Set for Ourselves

[7] One More Time: How Do You Motivate Employees? (Frederick Herzberg, Harvard Business Review, originally published 1968, republished 2003)

[8] Currencies (On Motivating Different People)

[9] Ibid.

 

Photo by pictures-of-money.

Next »